It is worth remembering how we all felt at the start of the COVID-19 pandemic: scared, confused and almost certainly convinced that economic catastrophe was looming.

Bermuda would have felt this more than most countries. Its size and existing challenges in its government finances made it vulnerable. Closing its borders was easy; navigating the unprecedented and multifaceted challenges of lockdowns, less so.

There were indeed some tough times. Yet the Island does seem to have a renewed sense of optimism at the moment. While challenges in sectors such as hospitality, leisure and tourism remain, some of its other sectors are thriving—and this offers a much-needed boost to its economy.

COVID-19 coincided, not completely coincidentally, with a hard market in the property/casualty industry. This has bumped up profits in existing carriers, although not as much as they hoped, and brought new jobs and opportunities to Bermuda. It has also led to the creation of a host of new companies, again needing staff, offices and infrastructure.

That is an echo of times gone by and the waves of new reinsurers that a large part of Bermuda’s economy is built on. But that is only half the story. Now, the Island is also enjoying the fruits of an increasingly buoyant life insurance sector. This has been a slow burner but it is now making its presence felt.

And, as ever, these pillars of risk transfer are complemented by a steadily growing insurance-linked securities sector; Bermuda remains the global leader in this form of risk transfer. The captive insurance sector has also been indirectly boosted by the hard market and while it is not seeing many formations, its existing captives are being used more and for more complex coverages.

All this is good news. But the theme that ties all these success stories together is one of innovation. Every time Bermuda becomes a market leader in something, it is usually because it moved first and had the expertise and infrastructure to deliver. Before you know it, you become a hub.

That is why the regulatory sandbox and renewed focus on insurtech are important. Who knows where such initiatives may lead—but that is what Bermuda has always done and it has reaped the rewards as a result.

That said, Bermuda must address a more basic issue: it needs more people. A bigger working population, to be more specific. That is less about innovation and more about government policy, although that too can be imaginative, as illustrated by the successful Work from Bermuda scheme. It just needs more people now. Lots more.

The bottom line is that, while Bermuda’s economy has taken a massive knock, overall it proved itself to be a lot more robust and resilient than that of many other countries. As a result, Bermuda looks well-positioned—certainly compared with many other countries—to thrive post-COVID-19. In fact, the pandemic could accelerate certain positives for the country and inform the complex discussions around immigration, which remains central to any debate about the Island’s future.

Wyn Jenkins, managing editor, Bermuda Finance

Image courtesy of Shutterstock / Rawpixel.com